Drain and rinse the soaked cashews thoroughly.
Add the cashews, 1 cup of water, nutritional yeast, lemon juice, garlic powder, onion powder, salt, smoked paprika, and turmeric to a blender.
Blend on high until the mixture is completely smooth and creamy, adding additional water as needed to reach your desired consistency.
Taste and adjust the seasoning as necessary.
Pour the sauce into a saucepan and warm over medium heat, stirring frequently, until heated through.
Serve immediately with nachos or as a dip, or store in an airtight container in the fridge for up to a week.